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Maroon Corporation - Schedule of Cost of Goods Manufactured

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The following data (in thousands of dollars) have been taken from the accounting records of the Maroon Corporation for the just completed year. Sales-1,150
Raw materials inventory, beginning---   15
Raw materials inventory, ending---  40
Purchases of raw materials---   150
Direct labor---  250
Manufacturing overhead---    300
Administrative expenses---  500
Selling expenses---   300
Work in process inventory, beginning---   100
Work in process inventory, ending---  150
Finished goods inventory, beginning---  80
Finished goods inventory, ending---   120

Use the above data to prepare (in thousands of dollars) a schedule of Cost of Goods Manufactured and a Schedule of Cost of Goods Sold for the year. In addition, what is the impact on the financial statements if the ending finished goods inventory is overstated or understated?

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Your tutorial (ATTACHED) gives you a report showing how to find the missing amount ...

Solution Summary

Your tutorial (attached in Excel) gives you a report showing how to find the missing amount to compute cost of goods manufactured and cost of goods sold. Click in the cells to see the computations for missing amounts. A proforma income statement is given with inventory overstated and understated so you can "see" how the profit is changed. The excel spreadsheet is then a template for other problems that permit you to compute these amounts.